The owner of Leisure Boutique in a local mall is forecasting this month's (October's)demand for one of her best-selling products based on the following historical data: What is this month's forecast using a four-month weighted moving average with weights of .4,.3,.2,and .1?

Question

The owner of Leisure Boutique in a local mall is forecasting this month's (October's)demand for one of her best-selling products based on the following historical data:  What is this month's forecast using a four-month weighted moving average with weights of .4,.3,.2,and .1?

Quizplus · Accepted Answer

Using the four-month weighted moving average with weights of .4, .3, .2, and .1, we get:

(190 x .4) + (160 x .3) + (130 x .2) + (100 x .1) = 76 + 48 + 26 + 10 = 160

Therefore, the forecast for this month's demand is 141.

The Owner of Leisure Boutique in a Local Mall Is